7:20 PM, September 18, 2013

Mike Duggan stands in front of supporters as his campaign unveiled sandwich boards explaining how voters may properly write in his name on the city's primary ballot on Tuesday, Aug. 6. / Matt Helms/Detroit Free Press

State elections officials are investigating Mike Duggan’s campaign for mayor and a political action committee to determine whether there was a violation of state law in the donation and acceptance of corporate contributions, and whether there was any coordination involved in spending that money.

A letter that the Department of State sent Tuesday to Duggan and to Samuel (Buzz) Thomas, a former state senator who is treasurer of the pro-Duggan Turnaround Detroit PAC, gave both 15 days to respond to the allegations.

The investigation was prompted by a complaint filed by a separate PAC, Detroit Forward, which favors Wayne County Sheriff Benny Napoleon for mayor. Napoleon came in a distant second to Duggan in the city’s Aug. 6 primary.

“It is important to understand that the department is neither making this complaint nor accepting the allegations as true,” said the letter from Lori Bourbonais, an official with the state’s elections bureau.

Duggan spokesman John Roach declined to comment on the allegations that Turnaround Detroit improperly accepted donations, saying, “We’ve got nothing to do with the PAC.” He denied that the Duggan campaign worked in concert with the PAC, saying, “We do not coordinate in any way with the PAC.”

Fred Woodhams, a spokesman for the Department of State, said this afternoon that elections officials received complaints from Detroit Forward and former mayoral candidate Tom Barrow, who came in fifth in the primary.

“We decided to go forward with the investigation, so we’ve asked the Duggan campaign and the Turnaround Detroit PAC to respond,” Woodhams said. “The letter pretty much largely speaks for itself. We’ve asked the people to respond, and we’ll pretty much take it from there.”

Detroit Forward’s lawyer, Todd Perkins, said in a statement that the investigation “is the first step on the road to holding people accountable for their actions.”

“Many corporations and individuals were fooled into believing they were donating money legally in the primary,” Perkins said. “Detroit voters deserve better. Detroit corporations deserve better. Our community deserves to have the integrity of the campaign financing system protected.”

Melvin (Butch) Hollowell, a lawyer for the Duggan campaign, called the allegations “frivolous” and said the campaign and Turnaround Detroit have shared no data. He said the two entities may have shared common vendors for things such as voter lists, but he said Detroit Forward also shared vendors with the Napoleon campaign, and that in itself does not indicate collusion between PACs and candidate committees.

“Detroit Forward did the same thing that they’re saying is objectionable,” Hollowell said. “We expect the complaint will be dismissed as without merit quickly.”

Detroit Forward, the pro-Napoleon PAC, alleges that Turnaround Detroit has raised $1.2 million — spending $327,000 to help elect Duggan — with almost two-thirds collected illegally from corporations, and coordinating activities such as advertising with the Duggan campaign.

Woodhams said that outcomes of the investigation could range from dismissing the investigation if no illegal activity is found, to fines or an agreement to stop potential violations if they’re found. The general election is Nov. 5.

Thomas, identified as cochair of Turnaround Detroit, said the Secretary of State’s Office is “following its process and asking for our comments, and there is nothing unusual about that.” He also denied there was ever coordination between the PAC and the Duggan campaign.

“Turnaround Detroit is following all proper procedures for responding and adheres to the legal guidelines for accepting contributions. We are confident that when the Secretary of State is done with their review, they will find that we are in full compliance with all of the relevant rules and laws.”